^ Team Silent didn't develop Homecoming, so any Ideas they had for a potential SH5 died when they stopped making the Silent Hill games.
SH2 and 4 were made by the same people and they may well have thought about using Walter as a character when they wrote the newspaper clipping about his
I don't think Double Helix would have gotten their hands on anything that Team Silent wrote so that would debunk the possibility of any of their ideas getting into Homecoming, more's the pity =( as they would have made it better.
I don't hate homecoming but it was the beginning of the end.
L.S. could be anyone, could be nobody, just two random letters, there's not really any evidence to even make an educated guess.
If it were officially referring to someone in particular, somebody on this forum would have found out by now. Of that I am certain.
I don't think any of the characters in Homecoming already existed in the mythos of SH. DH made them up.